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Vietnam Airlines still incurs losses despite revenue surge in Q1

Vietnam Airlines still incurs losses despite revenue surge in Q1

Wednesday, May 03, 2023, 21:11 GMT+7
Vietnam Airlines still incurs losses despite revenue surge in Q1
The market shares of Vietnam’s airlines in 2022 and their revenue and profits in the 2017-22 period. Graphic: Tuong Vi

National flag carrier Vietnam Airlines recorded an after-tax loss of VND37 billion (US$1.6 million) in the first quarter of this year although its consolidated revenue skyrocketed 202 percent year on year.

The airline earned VND23.64 trillion ($1 billion) consolidated revenue, according to its consolidated financial report for last quarter.

However, its losses tumbled 99 percent over the same period last year, when the air carrier suffered a deficit of nearly VND2.7 trillion ($115.6 million).

Vietnam Airlines submitted VND931 billion ($39.9 million) in taxes and fees to the state budget last quarter.

As of March 31 this year, the air carrier’s assets topped VND59.6 trillion ($2.6 billion).

Its equity was negative VND10 trillion ($428.5 million) and its HVN stock is still on the watchlist.

Vietnam Airlines leaders said the firm was still striving to work out solutions and seek support from state management agencies to cut its losses.

Meanwhile, budget air carrier Vietjet posted revenue of nearly VND12.9 trillion ($552.6 million) and after-tax profit of VND173 billion ($7.4 million).

The airline operated 31,300 flights carrying nearly 5.4 million passengers in the first three months of the year, soaring 57 and 75 percent, respectively, year on year.

It also transported more than 14,800 metric tons of cargo, up 20 percent over the year-ago period.

International passenger transport remained a bright spot of Vietjet’s business as it accounted for nearly 45 percent of the firm’s total passenger transport revenue and 30 percent of its total passengers.

The air carrier contributed VND1.05 trillion ($45 million) in taxes and fees to the state budget last quarter.

Vietravel Airlines and Bamboo Airways have yet to release their financial reports for the first quarter of the year.

Vietravel Airlines conducted nearly 1,600 flights in the period with an average occupancy rate of over 91.2 percent.

The air carrier recorded a profit of VND200 billion ($8.6 million) in the last quarter of 2021 and 2022, when local airlines Vietjet and Vietnam Airlines incurred losses.

Vietnam’s aviation sector served 99 million passengers last year. 

However, the sector struggled due to high fuel prices, the small number of international customers, and high operation costs.

Experts are still pinning high hopes on a brighter prospect of the sector as aviation is a key driver of the local economy.

The reopening of existing international air routes and the launch of new ones, coupled with falling fuel prices and lending rates, are expected to back the aviation sector in the coming time.

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Thanh Ha - Tuong Vi / Tuoi Tre News

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